Reference Check vs Employment Verification

January 10, 2019
    

Often, you’ll hear the terms reference check and employment verification used interchangeably as though they are the same thing.

But that is a big misconception.

Both a reference check and employment verification check can be used to confirm employment history, but a reference check can be used for much more.

What is a reference check?

A reference check is part of the hiring process where your candidate (or applicant) connects the hiring company with professional (and sometimes personal) references to gather more details about themselves: their work history, job responsibilities and performance. Professional references can include coworkers, direct managers or other employees who worked closely with the candidate.

During a reference check call, typically the recruiter asks questions related to productivity, communication and listening skills, successes, failures, attendance, culture fit, strengths, and weaknesses.

Although more valuable information should be attained during reference conversations by asking the right things the right way, often recruiters and hiring managers are constrained to only gaining knowledge on basic facts during these checks due to the time limit of conversations and the lack of candid responses from referees.

And simply because they can be time consuming to conduct, traditional reference checks often happen late in the interview process, once a company has chosen a final candidate. This serves as a huge drawback due to confirmation bias. Checks tend to be just cursory at that point, rather than actually providing useful information to better inform hiring decisions, and even negative feedback is unlikely to change the hiring manager’s decision at such a late stage in the process.

When using a digital reference check process on the other hand, the reference checks can be done quickly and automatically earlier in the process, offering valuable insights into candidates from the start, before getting too far along.

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How is a reference check done?

Traditionally, a reference check is often conducted through a lengthy phone interview. During this process, it is not uncommon for recruiters or hiring managers to spend hours of time chasing down references and verifying data.

Today, we have Checkster’s digital reference checks, which allow applicants to submit reference requests online, directly to their contacts. Since the process is so simple, Checkster checks collect on average feedback from 6+ references, generating data-rich, actionable reports from candid reference feedback for recruiters and hiring managers to improve their hiring decisions.

In addition to saving time, contacts invited to provide candidate feedback online are more likely to provide honest input, leading to better quality insights about candidates, as well as faster response times.

Strategies for Leveraging Reference Checks

When conducting reference checks, think about how you’ll use them to make strategic hiring decisions.

Some of the best reference check questions challenge the assumptions you initially made about the candidate’s culture fit during interviews or uncover caveats to the candidate’s interpersonal and communication skills you might not otherwise find out.

Using different reference check questions can also expose weaknesses that were not discovered in the interview process.

A simple question like this one can collect a wealth of information:

How well did the candidate communicate or collaborate with the rest of the team?

A question like this will get you feedback on how well the candidate worked with team members or whether they preferred working independently. Based on fit, this type of feedback can make or break a hiring decision.

Check References Early and Often

An outdated practice still common in many organizations, is the method of checking references at the end of the hiring process. The mistaken belief is that reference checks can’t gather much valuable information and should be done at the end of the process, simply to confirm there are no glaring red flags in the work history of the candidate.

However, the best time to check references is actually immediately after the first or second round of in-person interviews and not later down the line. Before investing too much time on further interviews, it’s at this critical junction that gathering the right reference data can help confirm if a candidate is likely to be a good hire, and whether it’s going to be worth it to continue interviewing them, using significant manager, director and exec time.

Reference checks, when done well, can elicit highly valuable information that can directly inform the next steps in the hiring process. For example, a digital reference check may uncover that the candidate is fraudulent when gathering references, faking one themselves, or that the candidate actually performed poorly in a similar role recently.

Receiving this type of information near the end of the candidate decision process wastes everyone’s time. If this information is instead uncovered early in the process, as is possible with digital reference checks, a company can save time and money by narrowing down the candidates and moving ahead only with those receiving good reference reviews.

Reference Checks: Going Digital

The phone reference check is a thing of the past. Going digital with your reference checks saves teams time, provides better feedback, ensures compliance and is far more convenient for all parties involved.

Checkster’s digital reference checks reduce the time it takes to check references down to 2 minutes per candidate, and removes the need to play phone tag. Additionally, Checkster identifies fraudulent references during the reference check process, where the industry average rate of fraud can be as high as 4% of applicants.

To learn how you can get more actionable hiring data from Checkster, sign up for a free demo here.

What is employment verification?

Employment verification is the process where a prospective or future employer will confirm a candidate’s work experience with a previous employer.

Typically, the company will connect with previous employers to confirm job specific facts: job titles, start and end dates for each job, and reasons for leaving / termination (if applicable).

Similar to reference checks, conducting employment verifications over the phone can be time consuming and at times offer dubious or limited results.

How is employment verification done?

Employment verifications are done similarly to reference checks. Recruiters or hiring managers have to connect with previous employers over the phone to verify information.

This is typically done toward the end of the recruiting process, because doing this for all initial candidates is too time consuming.

By automating the employment verification process with Checkster, however, it can be done faster and thus earlier in the recruiting timeline. Recruiters are able to uncover red flags about a candidate’s history early on, saving time and avoiding making bad hires. In addition, Checkster helps companies remain 100% compliant by gathering detailed reports from the candidate’s employers and storing all documentation in one central place. This type of report tracking is nearly impossible using phone verifications.

Reference check or employment verification?

Employment verifications are great, but only for validating that an employee worked at a prior company in a specific role and worked for a specific period.

However, if you’re looking for more feedback and reviews on how applicants actually performed on the job and whether they will be a good fit with your company, then a reference check is the way to go.

You’ll want to structure the reference check process in a way that standardizes the questions across all applicants to establish an unbiased baseline. Here is a brief list of the items we recommend you standardize:

  1. Reference Interview Questions

Questions that can be asked of all references that will reveal valuable information about candidates.

  1. Criteria for References

Criteria for acceptable, unacceptable, phenomenal, underwhelming, etc. references.

  1. Vetting Process

How the credibility and integrity of references are verified.

  1. Time Per-Reference

The amount of time that should be devoted to each reference check.

When done correctly, reference checks uncover a complete history of how candidates performed in similar roles, even as you recruit in higher volumes. Digital reference checks bring reliable scalability to collecting reference feedback, giving you an advantage over companies that still collect reference feedback over the phone.